Govt to finish CCoW and CoW first contract amendment this August

By Hisky Darmayana

The Indonesian government through the Ministry of Energy and Mineral Resources (ESDM) expects to finish the first stage of contract amendment for Contract of Work (CoW) and Coal Contract of Work (CCoW) in August 2012, of which 5 CoW and 10 CCoW license holder companies within the last couple of months have agreed to sign their respective renegotiated contracts.

"We're still discussing the terms with the renegotiation team, finalizing possible items that will need further coordination with other ministries," said Director General of Mineral and Coal of the ministry Thamrin Sihite in Jakarta, adding that such coordination will be conducted between June and August.

"In addition to infirm coordination between agencies and Presidential Decree No.3 Team, we also plan to conduct meetings with subjected license holders during those months," he said, adding that the signed contract amendments will be reported by ESDM to the president in September.

Thamrin stated that contract renegotiation for the remaining CoW and CCoW licence holders, those who have not signed the first stage of contract amendment, will be pursued this October. Six items contained in the renegotiation of contracts are concession area width, contract extensions, royalty, upgrading obligation, divestment obligation and local content utilization.

Editing by Er Audy Zandri